Dairy farmers seeing profits rise

Central Minnesota's dairy farmers have been thankful for the past couple of Minnesota milk price reports. Last month, for example, the price per 100 pounds was $26.40. That's more than $7 higher than last July.

"I've talked to some people who are very excited about that because obviously they're going to get more for what they produce," said Emily Krekelberg, a livestock educator with the Stearns County Extension Office. "It reminds you of how everything can change and evolve. Corn was around $7 a bushel and that's been creeping down lately."

Krekelberg said it's impossible to forecast what will happen, but she doesn't expect milk prices to fall soon. The increase this year from last year's average price so far has been about 25 percent. That's similar to what the industry experienced in 2010 and 2011. Prices fell almost 4 percent in 2012 and didn't recover that margin through 2013.

"It's important to remember that what people pay in the store isn't necessarily influenced by what the farmers receive," Krekelberg said. "Their milk is bought by companies and co-ops who set the prices. The price of milk in the stores has been fairly steady for a while, but there was a time not long ago when the consumer was paying more and the farmer wasn't necessarily getting paid more, either."

The Times tracks several agricultural commodities on a quarterly basis as an indicator of the Central Minnesota economy.

The price of oats is almost flat to 2013 so far at an average of $3.71 per bushel through the first quarter.

In five of the past 10 months, data on potato prices received have been withheld to avoid disclosing data for individual operations. The most recent prices available, however, represent an increase of less than 5 percent from last year.

Alfalfa, which spiked as high as $265 for a baled ton last May, averaged $189 last month.

"Prices skyrocketed last year because of a concern about winter-kill — which didn't turn out to be as bad as people thought — and drought in other areas of the country," Krekelberg said. "We were a little short on alfalfa last year and the quality wasn't terrific, but it was OK. And the outlook for this year seems pretty good. So hopefully those high prices won't be a factor again."